Section 301 — Increase in US Duties (Further Update)

Further to our earlier post today, the U.S. Trade Representative’s Office released late last night another notice that attempts to address the ‘shipments on the water’ issue (i.e., shipments exported from China before 12:01 am ET this morning, but entered for consumption in the United States on or after 12:01 am ET this morning). 

 The notice, which will be published in the Federal Register shortly, provides that such shipments will be subject to the 10% duty rate so long as they are entered for consumption, or withdrawn from warehouse for consumption, prior to June 1, 2019 (i.e., in the next 3 weeks).  The notice creates a new HTS subheading for such shipments.  A copy of the notice is attached for your reference.  Implementing_Modification_to_Section_301_Action

 Assuming that the new HTS subheading is available in the system, this obviates the need for importers of these shipments to pay the 25% duty and claim a refund, or delay the filing of the entry summary, as suggested in CBP’s CSMS message from yesterday.

 On a related note, the negotiations are continuing here in Washington, DC today.  We are expecting further updates (or at least tweets) over the weekend.  Also, in response to the increase in duty rate from 10% to 25%, China announced that it was ready to take “necessary countermeasures” but did not specify what those countermeasures will be.  Stay tuned.  Interesting times.

 We hope this update is helpful.  If you have any questions, please let us know.

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